Bottom line: The FCC didn't have regulatory authority over Comcast's unreasonable network management practices because it failed to tie that authority to any express statutory delegation by Congress.

FCC can't rely on Title I's "necessary and proper" clause to give it jurisdiction over Comcast's unreasonable network management practices, because this kind of "ancillary jurisdiction" has to be necessary to further its regulation of activities over which it DOES have express statutory authority. (Example: the FCC 40 years ago went after cable to protect broadcast. It didn't have statutory authority over cable, but it did over broadcast — and the Supreme Court agreed that its exercise of power over cable was "reasonably ancillary" to its power over broadcast.)

FCC had said that the "necessary and proper" clause, by itself, gave it authority — but this claim has no particular limits. If we believe that agencies act under delegated authority from Congress, there has to be some link in the FCC's order to an express statutory delegation of authority.

Implications: There are both narrow and broad stories to be told here.

Narrow:

The next time the FCC wants to issue an Order or otherwise exercise power over high-speed Internet access providers, it had better be very clear about the source of its power, and it can't rely on just its "necessary and proper" clause in Title I.

Broad:

FCC's arguments for its power over high-speed Internet access providers generally are now in jeopardy. It can't rely on Brand X as an affirmation of Title I authority, because the Court in that case simply deferred to the Commission's regulatory classification of cable modem services.

FCC's powers to impose consumer privacy protections on broadband providers or mandate the publication of cost information by them are now in jeopardy. These key elements of the National Broadband Plan may not be enforceable under Title I, and attempts to carry out these portions of the plan are likely to be the subject of heated litigation. Similarly, its nondiscrimination rulemaking is now in jeopardy, because that step depended on the same legal assertions that the DC Circuit found to be unpersuasive in today's opinion.

Next steps:

The FCC will likely take a deep breath and consider its options.

By Susan Crawford, Professor, Cardozo Law School in New York City. More blog posts from Susan Crawford can also be read here.

The court told the FCC's bumbling lawyers that their best source of ancillary authority was paragraphs 706 and 230 of the Comms Act. But the FCC didn't use 706 in the Comcast order, and abandoned 230 in oral arguments in the appeal.

One might reasonably wonder if the FCC sandbagged this case in order to obtain a pretext for Title II reclassification.